Northwestern (NWE) AI Stock Analysis

• Market Cap: $3.54B
• Dividend Yield: 4.52%
• Average Volume (3M): 495.54K
• Price to Earnings (P/E): 15.7
• Beta (1Y): 0.24
• Revenue Growth: 3.78%
• EPS Growth: 7.48%
• Country: US
• Employees: 1,585
• Sector: Utilities
• Sector Strength: 60
• Industry: Diversified Utilities
• EPS (TTM): 0.40
• Shares Outstanding: 61,393,380
• 10 Day Avg. Volume: 382,969
• 30 Day Avg. Volume: 495,537
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.78
• Enterprise Value/Revenue: 4.14
• Enterprise Value/Gross Profit: 4.74
• Enterprise Value/Ebitda: 10.53
• 1Y Price Target: $59.59
• Price Target Upside: 2.83% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 6

• Rating: 77 Outperform
• Price Target: $65.00 ▲(12.17% Upside)

Northwestern Energy's overall score reflects strong technical indicators and positive corporate events, particularly the merger with Black Hills Corporation. While financial performance is solid, high capital expenditures and regulatory challenges present some risks. The stock's valuation is fair, supported by a strong dividend yield.

Positive Factors

Growth Opportunities

Growth visibility is improving with letters of intent from Altus Power and Sabey, which could lead to contracts and require new resources, enhancing potential growth.

Legislative Changes

Recently passed legislation in Montana should meaningfully reduce any potential liabilities related to wildfire tail risks.

Regulatory Outcomes

NorthWestern Energy Group delivered strong 1Q25 results, indicating successful regulatory outcomes, infrastructure investment, and load growth opportunities.

Negative Factors

Cost Overruns

The Montana Consumer Counsel proposed adjustment disallows a portion of the Yellowstone Country Generation Station rate base due to costs exceeding the original budget.

Rate Base Growth

The profile has below-average EPS and rate base growth.

Regulatory Challenges

The profile has a noisy regulatory history coupled with an expectation of more frequent filings going forward.

Northwestern Business Overview & Revenue Model

Company Description

Northwestern (NWE) is a leading utility company based in the United States, primarily engaged in the generation, transmission, and distribution of electricity and natural gas. Operating in the energy sector, NWE serves residential, commercial, and industrial customers across several states. The company focuses on providing reliable energy solutions while prioritizing sustainability and community engagement, with a portfolio that includes both traditional and renewable energy sources.

How the Company Makes Money

Northwestern generates revenue primarily through the provision of electricity and natural gas services to its customers. The company operates under a regulated utility model, which allows it to earn a return on investment through rates approved by regulatory bodies. Key revenue streams include residential and commercial energy sales, infrastructure investments, and ancillary services related to energy management. Additionally, NWE benefits from long-term contracts for energy supply and partnerships with renewable energy producers, which contribute to its earnings while aligning with regulatory incentives for sustainable energy practices.

Northwestern Financial Statement Overview

Summary

Northwestern exhibits strong profitability with a consistent gross profit margin above 90% and a stable net profit margin around 15%. Revenue growth is moderate, and while operating cash flow is robust, high capital expenditures lead to negative free cash flow. The balance sheet is leveraged, typical for utilities, with a solid equity base.

Income Statement

Northwestern shows strong profitability with a consistent gross profit margin above 90% and a stable net profit margin around 15%. Revenue growth is moderate with a 7.4% increase from 2023 to TTM 2025. EBIT and EBITDA margins remain healthy, indicating efficient operations.

Balance Sheet

The company maintains a solid equity base with a stable equity ratio of around 35%. However, the debt-to-equity ratio is relatively high at approximately 1.07, suggesting a leveraged position typical for utilities. Return on equity is consistent at approximately 8%, reflecting steady returns to shareholders.

Cash Flow

Operating cash flow remains strong, but free cash flow is negative, indicating high capital expenditures. The operating cash flow to net income ratio is robust, suggesting good cash earnings quality. However, the free cash flow to net income ratio is negative due to significant capital spending.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.53B	1.51B	1.42B	1.48B	1.37B	1.20B
Gross Profit	1.33B	1.29B	781.36M	985.80M	946.77M	892.48M
EBITDA	600.45M	574.43M	526.15M	466.58M	456.95M	416.19M
Net Income	225.51M	224.11M	194.13M	183.01M	186.84M	155.22M
Balance Sheet
Total Assets	8.14B	8.00B	7.60B	7.32B	6.78B	6.39B
Cash, Cash Equivalents and Short-Term Investments	2.94M	4.28M	9.16M	8.49M	2.82M	5.81M
Total Debt	3.09B	3.10B	2.79B	2.63B	2.56B	2.43B
Total Liabilities	5.26B	5.14B	4.82B	4.65B	4.44B	4.31B
Stockholders Equity	2.88B	2.86B	2.79B	2.67B	2.34B	2.08B
Cash Flow
Free Cash Flow	-128.46M	-142.50M	-77.66M	-207.90M	-214.35M	-53.61M
Operating Cash Flow	394.40M	406.74M	489.23M	307.24M	219.98M	352.15M
Investing Cash Flow	-532.94M	-554.46M	-570.81M	-516.86M	-435.83M	-405.80M
Financing Cash Flow	134.05M	151.55M	84.31M	213.32M	217.52M	58.68M

Northwestern Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 57.95
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NWE, the sentiment is Positive. The current price of 57.95 is above the 20-day moving average (MA) of 56.94, above the 50-day MA of 54.37, and above the 200-day MA of 53.80, indicating a bullish trend. The MACD of 0.97 indicates Positive momentum. The RSI at 62.50 is Neutral, neither overbought nor oversold. The STOCH value of 43.46 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NWE.

Northwestern Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OTTR	79 Outperform	$3.54B	12.42	17.13%	2.44%	-3.69%	-8.25%
BKH	77 Outperform	$4.34B	15.02	8.13%	4.49%	5.41%	-1.89%
NWE	77 Outperform	$3.54B	15.71	7.93%	4.52%	3.78%	7.48%
MGEE	74 Outperform	$3.11B	23.68	10.75%	2.15%	8.47%	12.76%
AVA	72 Outperform	$2.97B	16.42	6.91%	5.28%	2.41%	-9.85%
Sector *	66 Neutral	$17.25B	17.99	5.54%	3.64%	6.63%	11.55%
ALE	62 Neutral	$3.70B	20.12	6.46%	4.55%	-0.44%	-17.46%

Northwestern Corporate Events

NorthWestern Energy Reaffirms 2025 Earnings at Barclays Conference

On September 3 and 4, 2025, NorthWestern Energy’s executives will participate in Barclays’ 39th Annual CEO Energy-Power Conference, reaffirming their 2025 earnings guidance. The company aims for a 4%-6% EPS growth and highlights its strong utility foundation, diverse energy supply, and ongoing investments in infrastructure to meet future energy demands. NorthWestern Energy’s strategic focus on reliability, customer satisfaction, and sustainable practices positions it well for continued growth and positive stakeholder impact.

NorthWestern Merges with Black Hills to Form Utility Giant

On August 18, 2025, NorthWestern Energy Group, Inc. entered into a merger agreement with Black Hills Corporation, resulting in a combined entity that will operate as a premier regional regulated electric and natural gas utility company. The merger, which has been approved by both companies’ boards, will see NorthWestern become a wholly owned subsidiary of Black Hills, with the combined company expected to have a market capitalization of approximately $7.8 billion. The merger aims to enhance operational scale, financial strength, and investment opportunities, while providing benefits such as increased EPS growth rates and improved service reliability for customers across eight states. The transaction is expected to be accretive to each company’s earnings per share in the first year following the merger’s completion and will support a long-term EPS target growth rate of 5% to 7%.

NorthWestern Announces Merger with Black Hills Corporation

On August 19, 2025, NorthWestern Energy Group, Inc. and Black Hills Corporation announced a definitive agreement for an all-stock merger, creating a premier regional regulated electric and natural gas utility company with a combined market capitalization of approximately $7.8 billion. The merger aims to enhance scale, diversify business lines, and increase investment opportunities, with expectations of being accretive to earnings per share in the first year post-transaction. The combined company will serve around 2.1 million customers across eight states, with a focus on improving infrastructure and advancing a clean energy future. The merger is anticipated to deliver long-term value for customers, employees, and shareholders, while maintaining strong community support and advancing emissions reduction initiatives.

NorthWestern Energy Reports Q2 2025 Financial Results

NorthWestern Energy reported its second quarter 2025 financial results, showing a decrease in net income to $21.2 million, or $0.35 per diluted share, compared to $31.7 million, or $0.52 per diluted share, in 2024. This decline was attributed to factors like lower retail natural gas and electric usage, increased costs, and interest expenses, partially offset by higher retail rates and revenues. The company completed the acquisition of Energy West’s natural gas distribution system, adding over 33,000 customers and 43 employees. NorthWestern Energy announced a quarterly dividend of $0.66 per share and initiated a 2025 earnings guidance range of $3.53 to $3.65 per diluted share. The company is also affirming its long-term growth rates and capital investment plans, while working on regulatory updates and settlements in Montana.

NorthWestern Energy Highlights at Mizuho Utilities Conference

On June 5, 2025, NorthWestern Energy’s top executives participated in Mizuho’s Mid-Cap Utilities Conference in New York, engaging with analysts and investors to provide insights into the company’s operations and future prospects. The presentation highlighted NorthWestern Energy’s strategic focus on maintaining a strong utility foundation, with ongoing investments aimed at enhancing reliability and capacity to meet future energy demands. The company emphasized its commitment to sustainable growth, with a significant portion of its energy supply being carbon-free, and outlined its financial goals, including a target EPS growth of 4%-6% and maintaining a competitive total return for stakeholders.